LENOX – As city voters prepare to approve proposed community and school district budgets for fiscal year 2022 starting July 1, the finance committee has sent some warning signals while endorsing the spending plans.
In a series of recent meetings and a letter to local residents, committee members examined the impact of the waning COVID-19 pandemic, expected increases in school spending, and the potential for multi-million dollar capital investments for infrastructure projects.
“The Lenox Public Schools are one of the most important services in our city and, with around 56 percent of the city’s operating budget, represent our largest single issue,” the advisory board concluded.
Citing the proposed 3 percent increase in the school district’s budget for the coming fiscal year – a reduction from its tentative proposal for a nearly 5 percent increase – the finance committee, chaired by Kristine Cass, wrote: Pressure on the budget of the city and thus on property taxes. “
The committee approved the school spending plan with 4-3 votes, with the opponents expressing concerns about the âstructure of the school budgetâ. The costs are primarily driven by staff compensation, which makes up around 85 percent of the total cost of the school budget (excluding benefits) and is largely dictated by the city’s collective agreement with the Lenox Education Association. “
Finance committee members warned that with the union’s three-year contract “renegotiating this fall, the city needs to ensure that the resulting commitments keep spending on track and provide flexibility”.
Speaking at a recent meeting, committee member Michael Feder stated, “It feels like a freight train leaving the station is going 60 miles an hour and it’s going to explode.”
On the general budget proposal for the city government and schools, Feder said: “We are not saying that the sky is falling, but we warn you that our sources of income are limited, our expenses are starting to increase, our capital plan is very likely” can borrow a significant part of our expenses. “
He outlined a scenario that could limit revenue increases for the city, which could lead to “significantly higher residential property taxes”. However, several other committee members disagreed, pointing out that the city is on an upswing in the aftermath of the coronavirus pandemic and its concerns are speculative.
Agreement was reached on one key phrase for the letter to residents: âA full recovery in pre-pandemic revenue levels, combined with careful management of both operating and capital expenditures, will be important to maintaining our current and expected tax levy be.”
After heated debate, the committee agreed to state in its letter that “although conditions appear to be improving, persistent capacity constraints at Tanglewood and recruitment difficulties may continue to limit our tax revenues this year”.
Feder made it clear that his main focus is on “economic forces that will affect the city beyond the immediate future”. He told Chief Administrative Officer Christopher Ketchen that “you are doing an excellent job taking care of taxpayers’ expenses.”
However, Feder expressed frustration with his view that the Finance Committee “is not being used to its full potential”.
He also claimed that the public “is not what I would consider well-informed” and urged voters to make budgetary decisions “on an informed basis” with an important body of facts.
The letter acknowledges that âthe city has taken significant steps to reduce and defer spending in FY2021, but many departments need to resume full funding for FY2022 to avoid a reduction in services and quality. The support from the federal and state governments can partially compensate for any deficits, but the city must avoid being dependent on such financing, which may not continue indefinitely. “
Regarding the planned investment projects, the committee wrote that “the city will have to make significant investments over the next five years, with total costs currently estimated at $ 89 million”. Major projects include a federally prescribed modernization of the sewage treatment plant, a new center for public safety and repairs to the city library and town hall.
“It is likely that the city will issue bonds to fund much of this capital expenditure,” the letter said. âWork is underway to identify external sources of funding, including federal and state funding, and to refine project cost estimates. How much Lenox will have to finance by issuing bonds remains uncertain. “
The Finance Committee stated that “the city must carefully manage the total cost of these projects and the amount of debt issued in order to avoid a significant future housing tax burden that could be caused by the necessary debt servicing”.
“I think it’s great that we notified the townspeople,” said committee member David Carpenter, referring to the letter. âIt’s right there, you have to read it; maybe not everyone will read it, but we did a good job getting it out. “
And he added, “If we feel that taxpayers are not clear about something, we will be ashamed of us if we do not bring it forward responsibly.”
Feder called for “a sensitive, not alarming, but informative way” to alert local residents that “the school train is coming, we have buffed the capital budget on the station premises, but parts of it will likely come out”. . “
Registered voters can attend the annual town meeting on Tuesday at 5 p.m. on the Lenox Memorial Middle and High School football field, 197 East Street.